Paying insurance premiums can sometimes feel like a financial burden, especially if they're hefty or unplanned. However, credit cards have become a convenient solution to ensure you never miss your premium payments. Not only do they provide flexibility, but they also offer added perks like reward points and auto-payment options. Here's how to make the most of paying insurance premiums with credit cards.
Insurance isn’t just another expense—it’s a safety net for you and your family. Here's why:
However, the higher the coverage, the higher the premium. If managing premium payments feels overwhelming, credit cards can help bridge the gap.
1. Earn Reward Points
Premium payments can earn significant reward points, especially if you pay higher amounts. These points can be redeemed for travel, shopping, or cashback benefits.
2. Set Auto-Pay for Timely Payments
Avoid the hassle of remembering due dates by activating auto-pay. Auto-pay ensures premiums are deducted automatically, helping you maintain continuous coverage.
3. Convert Premiums into EMIs
High premium amounts? No problem! Many credit cards let you convert large payments into easy monthly instalments.
Choose tenures that align with your repayment capacity.
4. Manage Cash Flow
Using a credit card delays your cash outflow until the due date, giving you breathing room to arrange funds.
5. Trackable Payments
All transactions are documented in your credit card statement, making it easier to track expenses.
Paying insurance premiums with credit cards is simple:
Paying premiums isn’t just about financial protection—it comes with tax-saving perks too:
1. Under Section 80C
You can claim deductions of up to ₹1.5 lakh annually for premiums paid towards life insurance policies for yourself, your spouse, and your children.
2. Under Section 80D
Health insurance premiums paid online can earn deductions up to ₹25,000 for self, spouse, and children. For parents above 60 years, the deduction limit increases to ₹50,000.
By using a credit card for these payments, you also earn rewards while saving on taxes—a win-win!
Paying your premiums online with a credit card is not only convenient but also:
While paying insurance premiums with credit cards has its perks, there are scenarios where it might not be the best choice:
To summarise, choosing to pay insurance with credit card is a smart way to stay covered without financial strain. From earning rewards to managing cash flow and accessing EMIs, the benefits are numerous. However, like any financial tool, it requires careful planning and responsible usage. Ensure you understand your card’s terms, stay on top of payments, and leverage its perks to maximise your financial benefits.
